Checking Deposits Key Opportunity for Small Business Digital Lending

Bank checking account deposits and transaction activity have long been useful to savvy small business bankers in assessing credit risk and credit monitoring.  More than a financial statement compilation out of Quickbooks or old tax returns, small business bankers for small business loans under $100k know the value of watching daily deposits going through the checking account, NSF rate, transactions, loan balance and owner guarantor credit score.

Now more are documenting the value of automating this information as we do for MinuteLender®.  Forbes this week states, in “Using Deposit Data to SuperCharge Small Business Lending:”

“With a connection to a business bank account some non-traditional lenders can now leverage the incredible value of artificial intelligence (AI) and machine learning risk models to analyze the health of the business, make a sound lending decision and, in some cases, transfer loan funds quickly.”

Karen Mills of Harvard Business School in “The State of Small Business Lending” states that banks have a great opportunity to leverage the deposit data they already have.

“Banks have a formidable competitive advantage in digital loan acquisition with existing borrower bases of customers with deposit accounts.  Banks have only recently started to realize the potential of this approach.”

MinuteLender® leverages acquisition of deposits with loans, and monitors account volumes, transactions, and NSFs along with loan balance and usage, and guarantor credit to underwrite and credit monitor small business loans.

For more information, checking BusinessMinuteLender® at www.rcgiltner.com.